Question: Tom Johnson is saving for a new car that costs $50,000. How many dollars should he set aside now to have $50,000 in 6 years

Tom Johnson is saving for a new car that costs $50,000. How many dollars should he set aside now to have $50,000 in 6 years assuming money compounds at 4% annually? Present Value Interest Factors Period ON 8 12 15% 20% 1 2 3 4 S 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 29 -9904 .9615 54612 .9246 .9423 .8890 .9238 8548 .9057 .8319 .8880 .7903 8706 .7599 .8535 .7307 8363 .7026 .8203 .6756 .8043 .6496 7885 .6246 7730 .6006 .7579 .5775 .7430 .5553 .7284 .5339 .7142 .5134 .7002 .4936 6864 .4746 .6730 .4564 9434 B900 8396 7921 7473 7050 6651 6274 5919 5584 5268 4970 4689 4423 4173 3936 3714 3503 3305 3118 9259 B573 7938 7350 6806 6302 5835 5403 5002 A632 4289 3971 3677 3405 3152 2919 2703 2502 2317 2145 10% .9091 8264 .7513 .6630 .6209 .5645 .5132 .4665 .4241 .3855 3505 .3186 .2897 .2633 .2394 .2176 .1978 .1799 .1635 .1486 8929 7972 7118 6355 5674 5066 4523 4039 3606 3220 2875 2567 2292 2016 .1827 .1631 .1456 .1300 .1161 .0037 1696 7561 6575 5718 4972 4323 3759 3269 2843 2472 2149 .1869 .1625 .1413 .1229 .1069 0929 0808 0703 .0611 .6944 .5787 4823 4019 .3349 .2791 .2326 .1938 .1615 .1346 .1122 .0935 .0779 0649 .0541 .0451 .0376 ,0313 .0261 Select one: a. 38,515 b. 39,515 C. 40.515

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